22 BARRON’S August 3, 2020
doesn’t make the top 10. The firm lost points
in Backend’s ranking due to the portfolio’s
performance and the firm’s lack of personal-
ized investment advice from live advisors.
Wealthfront offers a leading set of digital
features, though. (See sidebar on page 21.)
Wealthfront notes it does have product
specialists available via phone: “We don’t
refer to or market these professionals as
financial advisors because that label has
no value to our client base,” a Wealthfront
spokeswoman wrote in an email.
Schwab’s Intelligent Portfolios lagged
behind its normalized benchmark—due
to allocations to value and international
stocks, plus a 10% cash allocation—but its
suite of digital advice products posted the
highest score for customer experience.
Schwab made up for some of those losses
with tax-loss harvesting. A customer who
invested $100,000 in a moderately aggres-
sive portfolio in September 2019 and in-
vested an additional $1,000 a month
through June 30 would have seen $10,700
in harvested losses over that period, based
on Backend’s analysis of an account it holds.
For someone in the 24% tax bracket, that’s
potentially $2,500 in tax savings.
Moreover, Schwab’s $47 billion robo is
one of the leaders when it comes to help-
ing retirees manage retirement income,
notes Backend. Launched earlier this year,
Schwab Intelligent Income looks across
investors’ retirement and taxable accounts
to project how much customers can safely
withdraw and determine the most tax-
efficient strategies for doing so.
“Everyone helps you save money, but
there are very few solutions in the market-
place that help you manage the spending
of your money when you’re in retirement,”
says Schwab’s Loh. “We’ve automated the
complicated process of generating that
paycheck from your investment portfolio.”
No single robo does all things for all inves-
tors—yet. But with new features, better algo-
rithms, and the option of human advice, ro-
bos have proved to be far more than a fringe
product for cost-conscious digital natives.B
Year-to-Date
Returns
The robos hold a mix of stocks and
bonds. Here’s how the portfolios per-
formed over the first six months of 2020.
Fixed Overall
Robo-Advisor Equity Income Return
Wealthsimple -7.7% 13.0% 0.4%
SigFig -6.6 6.8 -0.3
SoFi -4.5 2.4 -1.8
TD Ameritrade -7.2 4.8 -2.8
E*Trade -8.7 5.6 -3.0
Ellevest -7.6 0.7 -3.3
Fidelity Go -7.1 -0.5 -3.3
Wells Fargo -6.7 1.8 -3.3
Vanguard -6.1 1.9 -3.3
Betterment -10.2 2.0 -5.4
Source: Backend Benchmarking
What You’ll Pay
While many human advisors charge an annual 1% fee on assets, the robos start
at just 0.25%, with some offering their service free for initial investments
Robo-Advisor Account Minimum Fee
SigFig $2,000 No fee for first $10,000; then 0.25% annually
TD Ameritrade $5,000, $500 w/auto deposit 0.30% for intitial tier of service
Fidelity Go No minimum for digital advice No fee for first $10,000*
Vanguard $3,000 for digital advice 0.20% annually including underlying fees
E*Trade $500 0.30% annually
Betterment No minimum for digital advice 0.25% annually
Ellevest No minimum for digital advice $1 a month for initial tier of service
Wells Fargo $5,000 0.35% annually
Wealthsimple No minimum for basic account 0.50% annually on accounts over $100,000
SoFi No minimum No fee
*Fidelity Go charges $3 / mo. for accounts from $10K to $50K and 0.35% annually above $50K. Source: Backend Benchmarking
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